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Policyholder Exercise Behavior in Life Insurance: The State of Affairs |
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| Authors: | Daniel Bauer Jin Gao Thorsten Moenig Eric R Ulm Nan Zhu |
| Institution: | 1. Department of Economics, Finance, and Legal Studies, University of Alabama, Tuscaloosa, Alabama;2. Department of Finance and Insurance, Lingnan University, Hong Kong;3. Department of Risk, Insurance, and Healthcare Management, Temple University, Philadelphia, Pennsylvania;4. School of Economics and Finance, Victoria University of Wellington, Wellington, New Zealand;5. Risk Management Department, Pennsylvania State University, University Park, Pennsylvania |
| Abstract: | The article presents a review of structural models of policyholder behavior in life insurance. We first discuss underlying drivers of policyholder behavior in theory and survey the implications of different models. We then turn to empirical behavior and appraise how well different drivers explain observations. The key contributions lie in the synthesis and the systematic categorization of different approaches. The article should provide a foundation for future studies, and we describe some important directions for future research in the conclusion. |
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